The truth about the price of investigative journalism online

The folks at The Business Insider went and practiced some true investigative journalism in a story about Facebook.

What they found out: in the current online-only business model, true investigative journalism is unsustainable.

Here are their tweets about the project, via editor-in-chief Henry Blodget:

All right, look, here's the truth about this investigative reporting thing...

Everyone says they want more of it. No more aggregation, please. No more links. No more slideshows. No more picture of Erin Burnett.

Just more good old shoe-leather reporting, like they did in the good old days.

And so we do it!

A good old fashioned shoe-leather investigation. On and off for two years. Wheedling, Cajoling. Secret meetings. Documents. Hush hush.

And we find out some cool stuff! Not Pentagon Papers or Watergate, mind you. But good, secret stuff about the founding of Facebook

And then we have to chat with lawyers: What happens if Facebook sues our asses off? Will we get tossed in Big House for protecting sources?

And then the fact-checking. And the "hey, guys, sorry, we've got this story you're not going to like" call with Facebook. (First of many)

And we have to write and edit the darn thing, which takes, literally, all night (I sh** you not)

And we have to make sure it's correct and fair, because who doesn't want to be fair? I mean, these are just people. And who's perfect?

And because we don't have some massive staff of 8 editors per writer or something (no wonder NYT going bust), this is a tag team effort

So, anyway, we do the investigative reporting thing. And we produce a good story! Interesting, fair, fun (IMHO). Breaks new ground. Etc.

And people like it! (Except for one guy, who says he'd rather watch ice melt than read about Mark Zuckerberg). Kudos. Sense of pride.

And of course we'd love to do three of these a day -- figure out all the bad sh** in the world, get it out there, help people know beans

But the truth is, if we tried to do 3 a day, with our staff, we would DROP DEAD. We'd also go bust. Neither being a happy outcome.

So that means...

We're going to try to give you one of these once in a while. You like reading 'em. And we like making 'em. So it's smiles all around.

AND...

We're ALSO going to keep giving you the great stuff that OTHER sites are doing (hopefully with some helpful commentary attached).

And we're going to give you house porn, and features, and pictures of Erin Burnett. Because, truth be told, you GROOVE on that sh*t!

(And so do we, by the way--we've taken our fearless moral inventory, and we're ready to admit it)

And because, thanks to the Internet, there are THOUSANDS of smart people publishing great stuff. And it would be SILLY not to link to it.

So that's the truth about investigative journalism. It's important. It's great. But it is also fantastically expensive and time-consuming

So there you have it. Online, it's impossible to sustain such investigative journalism, because the budgets just aren't large enough (probably because print is still taking quite a chunk of advertising dollars -- the split isn't helping either side) and thus neither is the staff.

That's the thing about online -- pages need to be made every day. Who's going to turn over pageviews while all your reporters are off doing stories that -- while immensely helpful to your publication's reputation and brand -- eventually don't pay off in terms of pageviews?

Say you get 200,000 pageviews on a great investigative story, but it takes you a solid two weeks (not very long in investigative journalism land) of work to do.

You've given up whatever pageviews you would have made during those two weeks -- and even if you break even, your site has been silent for two weeks. (Unless, of course, you have a big enough staff to do so. Most online-only publications do not.)

See the problem? Investigative journalism is extremely expensive no matter which way you cut it, but it's impossibly expensive for an online publication. When you can get 100,000 pageviews on a photo gallery of Miley Cyrus, and another 100,000 on a post about the Apple iPad -- in the space of two to three days -- why bother with investigative reporting?

Like the newspaper industry as a whole, it's a "public service" that must be subsidized by more profitable, but less glamorous, content.

(Ergo, why Blodget decided to publish a photo gallery with 22 -- yes, twenty-two! -- screenshots of his already-published tweets that can easily be read in chronological order from his Twitter page. Because publishing is a business, and online, pageviews rule.)

A recent Columbia Journalism Review survey noted that magazine websites' editing practices were "slack" and not up to par with their print counterparts.

It's the same problem here: without budget and staff, you simply can't guarantee the same quality.

This is not an online versus print culture clash. This is as simple as balancing your checkbook. If editorial oversight comes at a premium, investigative journalism is simply out of reach for most publications.

Nick Denton: 'Flat Is The New Up? We Should Be So Lucky'

Gawker Media head Nick Denton has a lot to say about this recession we're in, and much of it is worrisome.


A concise, backed-up take on what Denton thinks is going to happen to Online Media in coming quarters:

To judge from a hysterical press, one might think the apocalypse was already upon the media industry: rolling cuts this month at Time Inc., the hallowed magazine group; a new catchphrase among advertising pundits, flat is the new up; and revisions even of the internet advertising that was supposed to be the salvation of the media industry. J.P. Morgan's Imran Kahn just slashed projected growth next year of US online display advertising from 16% to 6%.

We should be so lucky. These supposedly brutal layoffs at Time and other titles amount to only 6% of headcount at the bloated Time Warner magazine group. Other media groups such as the New York Times and Conde Nast—a hiring freeze, how callous!—are being even more squeamish. From conglomerates to internet ventures, executives should be planning now on a decline of up to 40% in advertising spending during this cycle. Instead they're sleepwalking into economic extinction—even those lean online ventures which were supposed to take up the mantle and preserve New York's position as a media capital.

His Machiavellian take to online publishers? Plan for the worst - now. How? Six ways:

1. Get out of ad-averse topics like politics
2. Renegotiate vendor contracts
3. Consolidate titles
4. Offshore more
5. Variable compensation
6. Offer more value for marketers
   

I don't agree with everything here, but Denton makes a good greater point: changes must happen soon, and they must be educated.

Read the post: Doom-mongering: A 2009 Internet media plan

A Wall-less 'Wall' Street Journal Losing Online Revenue? Not A Chance.

The Wall Street Journal will lose $63 million in revenue if it made its advertising free.

That's what the media world is saying after Rupert Murdoch and Co. hinted that the last "Great Wall of Online Journalism" might soon fall, months after its closest competitor put the kibosh on TimesSelect.

But you know what? With all of the numbers floating 'round in that article, I really think this flap is misleading.

"Recovering that in advertising sales would require boosting traffic by 130 percent, based on calculations by Reuters and Mike Vorhaus, managing director of Frank N. Magid Associates and a veteran media industry consultant to Dow Jones, New York Times Co's namesake newspaper and Time Warner Inc's online unit AOL.

Few doubt Murdoch's logic, given that as much as 80 percent of financial Web site visitors leave after refusing to pay subscription fees, according to Vorhaus, and given the rapid growth of Internet advertising."

You know what, Rupe? I'm right there with you on this one. If the Journal brought down the wall, there would be an instant traffic boost (the difference between The New York Times and this one is that most of the Journal's content, and not just editorials, is behind the wall). I'm not going to lie -- I regularly read the daily free WSJ.com content and only if I have access, such as during a "free" day or through an institution, will read further. Why?

The 21st century's mantra online, that's why: If it causes me difficulty or expense to get, I don't want it -- especially if I can get it somewhere else.

Meanwhile, the whole nation is wondering what's going on and why they should care when the press screams out that FOX-bred Murdoch is buying the Journal. Why should they care? It's not like the occasional reader is going to pony up the dough for an annual WSJ subscription.

But if it's free, and it's online, they might just read it. And what WSJ-er wouldn't want their quality work to be seen?

It sounds like a management decision, but it's really an editorial win -- and don't let the numbers fool you, because it's not a big hit against the Journal to lose that kind of cash:

1. Because newspapers primarily rely on advertising and not subscriptions, even if they do bring extra cash flow;
   
2. Because while that figure is the top of the pops for online journalism, it's pebbles compared to the printed edition;
   
3. Because the Journal will see large traffic increases just by lowering the wall, thus increasing advertising rates; and
   
4. Because there's no reason why the Journal, in setting an online trend, can't raise it's online advertising rates and start changing the business model top-down for the whole industry.

It's still early in the online business model, isn't it? Whose to say advertisers aren't going to pay increased rates for a newly-free online Journal?

With such quality writing in that newspaper, the risk is lower than, arguably, any other publication to make this kind of jump. And if Murdoch's smart about it, he'll advertise that fact like it's the second coming of the Fox Business Channel.

Readers will return -- shouldn't the Journal be confident in that?

How Much Is A Magazine Worth? Not Much, Readers Say

PASTE magazine recently launched an interesting endeavor on the business side of journalism: a "pay what you want" model for a yearly subscription to the publication. The idea follows the moves of indie rockers Radiohead, who released their latest album In Rainbows in a similar fashion.

So for the next two weeks, both new subscribers and old readers can pay what they think an annual subscription is worth, starting at $1 with the sky as its ceiling ($19.95 is what a subscription normally runs). An interesting catch for any philanthropic readers: anyone paying more than the standard price will be thanked in print.

The theory? New readers mean more eyeballs total when they discover PASTE's content. The magazine says the model gives them insight into just how much their regular readers think the magazine is worth, but I fear they will be sorely disappointed.

The problem with this effort, to me at least, is that there is generally little perceived value of a magazine. A magazine comes without fail on a regular basis, leading readers to assume it is a part of their life.

Moreover, an ongoing stream of magazines costs much more than a single Radiohead album that is released every four years. Radiohead fans know that the band spends time in the expensive recording studio, noodling away at their masterpiece and posting pictures documenting the process over the course of a year. But few readers know who works on their magazine and how many that entails. The staff of a magazine -- as well as its headquarters -- are faceless to the average reader that doesn't live in New York.

Basically, it comes down to this: their daily work is something that everyone with a 9 to 5 has to do, so why should the reader pay for it?

Aren't advertisers enough? I hear the reader asking.

Add a complete lack of reference to how much it physically costs to print a magazine and it seems this move just undercuts every effort of the glossy industry to establish the $5 benchmark.

Now I'm no glossy defender, but it seems to me that PASTE is getting way ahead of itself, mimicking a trend that they should be just covering. Hell, even O, The Oprah Magazine would have trouble with this.

Expect this to end -- soon. It's just not a good model for this industry; there's no middle man to cut out. A true comparison would be freelancers directly selling their work to readers. And that is yet unforeseen.